Dollar weakness drives GBP/USD to three-month high but takes USD/JPY and USD/CAD lower
The greenback continues to suffer, moving lower as investors continue to move out of the dollar on expectations that the Fed is now at the end of its hiking cycle.
GBP/USD moves to fresh three-month high
The GBP/USD rallied on Tuesday to its highest level since the end of August.
The continued strength in the upward move has negated any bearish view for the time being. Further gains appear to target the $1.28 level, and then on towards the $1.30 and $1.31 levels in the medium-term.
A reversal back below the 200-day simple moving average (SMA) would signal that a more substantial pullback was in the offing.
USD/JPY breaks lower
A second day of heavy losses for the USD/JPY has taken the price back to the November lows.
A test of the 100-day SMA now seems likely, and further declines towards support around ¥145.00 could result. This marks the most significant pullback in the pair since June and July, though the longer-term uptrend is still intact and could be restored if the price establishes a higher low.
In the short-term, buyers would likely view a move above ¥149.00 to be a bullish development which might then see the price head towards ¥152.00 again.
USD/CAD takes further losses
After slumping below support on Friday, the USD/CAD has continued to decline.
Tuesday’s losses have seen the price reach a two-month low. It will now be up to the buyers to establish a higher low in the region of the 100- or 200-day SMAs in order to reassert the uptrend. A close back above the 50-day SMA and above C$1.365 would help to restore a bullish outlook.
Further declines would see the price head on towards the September lows around C$1.34.
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